TORONTO, ON. (NEWS 1130) – With Sears closing up shop across the country and announcing it won’t honour warranties, a lawyer in Toronto is starting a fight to better protect Canadians when companies go bankrupt.
As the downturn started for Sears Canada, we reported on executives and managers getting millions of dollars in cash bonuses, while employees were left without severance and their pensions up in the air.
And therein lies the problem, according to employment lawyer Lior Samfiru. He says Sears is legally obligated to maximize the amount of money for secured creditors, which employees are not.
He adds bankruptcy should not be an all or nothing game for employees and he’d like to see them turned into some kind of secured creditor. So far, Innovation Minister Navdeep Bains has only said the federal government is considering legislation to protect employees’ pensions when a company goes bankrupt.
While there’s no plan for the government to introduce legislation at the moment, he says it will carefully examine two different private member’s bills on the subject, put forward by a New Democrat MP and a Bloc Quebecois MP.
“This is a legitimate issue and a legitimate challenge,” Bains said Wednesday, adding that the government is “very mindful” of the fact that bankruptcy “could happen at any time with any company.”
The federal NDP wrote Prime Minister Justin Trudeau on Wednesday as well, asking him to launch a special parliamentary investigation into the liquidation of Sears.
Liquidation sales are underway and are expected to last anywhere from December to January.